Albany Molecular (AMRI) has been a big name in contract research for many years now. They’ve had a lot of twists and turns in their history, including being taken private a couple of years ago after having taken on a good deal of debt by acquiring other companies in turn. But it sounds like they’re about to have one more.
Back in 2011, they announced an “in-sourcing” deal with Eli Lilly. Former Lilly chemists (who had already been let go by rounds of layoffs in Indiana) were re-hired by AMRI to go back and work in the same labs as before, just not as Lilly employees. And, one assumes with great confidence, not with Lilly salaries and benefits, although it certainly boosted AMRI’s head count in the area. But this arrangement seems to be coming to an end. I’m told that these chemists have been notified that almost all of these positions are being cut, though. The chemists involved have priority in the queue for any openings at other
Lilly AMRI sites; otherwise I believe that they’re being offered severance packages. My understanding is that they’re not being replaced – at least for now, they leave behind a floor of empty labs.
I would assume that this was more of a Lilly decision than an AMRI one, although I don’t have any more details. And I’m also trying to match that up the news with this earlier announcement that AMRI was extending “a key insourcing relationship with a major pharmaceutical company” that had started in 2011 and was set to expire in December 2018. That sure sounds like the Lilly deal, both the starting and finishing dates – if it refers to someone else I’m glad to be corrected – but if so, what happened to that extension out to 2021? AMRI does a lot more than this sort of thing, of course, including a lot of contract manufacturing, etc. Last I heard, they had facilities in about ten different countries. But what’s been happening with the whole idea of insourcing chemists, anyway?
This was a big topic back in 2011 and 2012, but you don’t hear as much about it these days. Is that because it’s become quietly normal, or is it because it hasn’t taken off the way it looked like it was going to? I can tell you that at the time of the 2011 Lilly/AMRI deal that a number of chemists were rather pessimistic (I know, how unusual, but still), thinking that this was the look of the future: get downsized so you could be hired back at lower wages, because where were you going to go, eh? Perhaps one thing that’s happened to this model is the concentration of biopharma research into hubs like Boston/Cambridge. Lilly always had the reputation of being sort of an island unto itself out there around Indianapolis, and people laid off from there often had to uproot everything and move to a totally different part of the country. In that situation, being insourced might be well, not exactly attractive, but making the best of a bad situation. But you can be laid off in Cambridge with the hope of finding another job that lets you even keep using the same parking garage.
Unfortunately, that really doesn’t seem like it’s going to be the case with this Lilly announcement. If an insourcing move might have saved some people’s positions and family situations at one time, what to do when that goes away in turn?